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The return and exchange policy

A retailer can build a good selling reputation by having a sound return and exchange policy in place.
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Retailers sell manufactured goods straight to the consumers. This role makes the retail business vital to both manufacturers – who are given a wider network to distribute and sell their products – and the consumers – who need access to these products.


Retailers face consumers directly and this places a great responsibility for them to ensure that the products they sell are of good quality, reliable, and safe. To thrive in the business, a retail store must develop a reputation for selling quality products. After all, consumers look for value for money these days, and no one would patronize a store notorious for selling defective wares.


One way to build a good selling reputation is to have a return and exchange policy in place. Undersecretary Zenaida Cuison Maglaya of the Department of Trade and Industry’s Consumer Welfare and Trade Regulation Group says a sound return and exchange policy reflects a retailer’s genuine concern for customer satisfaction as he consciously upholds the quality and reliability of the products he offers for sale.



Maglaya says taking care of the customers is one crucial strategy many retailers overlook or take for granted. Fully aware of the direct effect a satisfied clientele has on a business’s bottom line, the DTI had embarked on a campaign to convince retailers that “consumer welfare is business welfare.” Offshoots of this campaign were the establishment of Consumer Welfare Desks in retail stores and recently, the search for the DTI Certified (consumer-friendly) Establishments.


“On its face, the return and exchange policy is meant only to protect consumers against hidden defects, but this policy also effectively builds goodwill between the retailer and his clients. The store benefits in the long run because when he satisfies a customer, that customer will return,” says Maglaya.


So how does a retailer formulate a good return and exchange policy? He or she must set the conditions under which he is willing to accept a return or an exchange of goods. He can choose to accept only those products with factory defects, which the Consumer Act mandates, or he can choose to do more, such as accept returns or exchanges even if the products passed muster.



The Consumer Act places the responsibility on the seller to act on the buyer’s behalf whenever a consumer product is found to be defective. If a warranty covers a product, the retailer should present the warranty claim to the manufacturer or distributor at no cost to the buyer. The retailer should also shoulder the costs of honoring the warranty if the manufacturer or distributor fails to do so. In these cases however, the retailer can proceed against the manufacturer or the distributor. The retailer must also bear the cost of replacing, repairing, or refunding a defective item when the manufacturer cannot be identified or when the retailer did nothing to preserve perishable goods.


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